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Obama, immigration and the Silicon Valley workforce

29 Jan

The US technology industry might finally get the immigration reform that it wants. Bipartisan Senate groups introduced two technology-focused bills this month. The Immigration Innovation Act – which increases the cap on H-1B Visas from 65 000 to 115 000, eliminates per-country limits on visa petitioners and lets spouses of H-1B visa holders work – came out of conversations with corporate technology leaders.

The Start-up Act, which has been introduced on three earlier occasions, creates a new visa category for foreign entrepreneurs. It also seeks to change the tax code to benefit start-ups. It was co-sponsored by six senators including Democrat Mark R Warner, who himself was a venture investor before he turned to politics.

Should these technology-related measures die, companies like Facebook say they will face a talent shortage. The situation could endanger US competitiveness as Canada, Germany, South Africa and China attempt to woo engineers from abroad too. Chinese companies have recently made huge venture investments in entrepreneurs around the world and the Silicon Dragon is seen as a serious threat to Silicon Valley.

If either of the proposals becomes law, it will mark a turning point in the fight for immigration reform. They are a far cry from the comprehensive immigration bill that the Senate passed last year (only to see it killed by the House of Representatives). That proposal tied the fates of technology employees to those of the 11 million or so undocumented immigrants in the US.

Back in December, I attended a talk on immigration with a handful of venture capitalists, lobbyists and entrepreneurs. During that conversation, the idea was floated that politicians might soon attempt to decouple the fight for more H-1B visas from the broader fight to reform the system for undocumented workers.

Letting more educated technology workers into the country seemed like an easier political fight to take on for that crowd than dealing with the millions of people who have lived here for years without papers. That approach isn’t a slam dunk. Worries abound that H-1B visa holders steal jobs from Americans or work for lower wages, despite the protestations of technology executives.

I’ve also spoken with Joe Lonsdale, a venture investor at Formation 8 and a supporter of, a technology industry group that supports comprehensive immigration reform.

“Many people in Silicon Valley understand that this is a moral issue,” he told me, adding that illegal immigrants and skilled workers alike should be treated better by our system.

But Lonsdale was unwilling to say whether or not the H-1B fight had to be inextricably linked to broader immigration issues. “The one thing I’ll say on policy is that on this issue in particular, both the far left and far right are very problematic.”

After the Senate bills were announced last week, I spoke with Julissa Arce, the director of development at Define American, an organisation that wants to create a more thoughtful conversation about immigration.

She said that people in the US tended to have a strong bias against undocumented workers, but not against people who came to the US to work in technology.

“The unconscious bias is that undocumented workers are stealing jobs,” Arce said. “On the other hand, people believe that workers who were born overseas, have a college degree and are ‘highly intelligent’, should be part of the American workforce.”

It doesn’t take much probing to poke holes in that distinction. Thousands of undocumented youths graduate from high school and college in the US. How are they different from their peers in India and China applying for their H-1B visas?

Nevertheless, Arce said that bias had contributed to the change in approach when it came to immigration reform. Technology executives and investors understandably feel that they have no choice but to support a bill that breaks with the strategy of comprehensive reform.

“For the technology industry it’s important to get some reform done even if it doesn’t cover everything,” Deepak Kamra, a venture investor at Canaan Partners, said. Large technology players like Facebook essentially occupy the same position.

“There is no denying the skills gap that threatens the expansion and competitiveness of a sector that has been a tremendous engine of innovation, economic growth and job creation in America. The Immigration Innovation Act addresses this gap,” a Facebook spokeswoman said in a statement. “[We] look forward to working with the Senate to get this bill passed.”

These bills aren’t guaranteed to become law, of course. Immigration is broadly perceived as a pet project for the White House (especially after President Barack Obama moved to lift the immediate threat of deportation for about 5 million immigrants who currently reside in the US illegally). The Republican-controlled House has vowed to stymie the president’s agenda on all issues, and immigration is a highly visible and contentious matter.

Representatives recently voted to block funding tied to Obama’s immigration order.

Given how slim the chances are for sweeping reform, I tend to agree that some change is better than none – even if it arbitrarily and erroneously reinforces the notion of “good immigrants” and “bad immigrants”.

My hope is that the technology community will still be willing to lobby for the unskilled immigrants whom Arce supports – even if Silicon Valley gets H-1B reform. – Bloomberg View